Skudai state assemblyperson Dr Boo Cheng Hau has filed an emergency motion to the Johor legislative assembly for a debate on the collapse of the Bandar Malaysia deal.
Boo said that the deal involved KPRJ Sdn Bhd, which is owned by the Johor government, and would have an impact on investors’ confidence in Iskandar Malaysia.
KPRJ has 24 percent equity in the Iskandar Waterfront Holdings and China Real Engineering Corporation (IWH-CREC) consortium.
The state government should address concerns on the potential impact of the botched deal on KPRJ and Iskandar Malaysia to clarify doubts and speculations, the DAP assemblyperson said in a statement.
Among others, Boo urged the state government and the menteri besar to clarify whether RM741 million was returned to the IWH-CREC consortium and whether a partial sum of RM178 million was in the interest of KPRJ.
Boo also urged the state government to clarify if the real cause of the botched deal was due to IWH-CREC’s inability to keep up with payment obligations, as this can erode investors’ confidence towards IWH, KPRH and, in turn, Iskandar Malaysia.
Additionally, Johor’s interest in Bandar Malaysia was also due to the upcoming high-speed rail project, which is supposed to cut down travel time from the state to the national capital.
According to plans, the rail line will be between Bandar Malaysia in Kuala Lumpur and Jurong East, Singapore, with a stop in Iskandar Puteri in Johor.
Putrajaya’s deal with IWH-CREC was called off on May 3. The consortium was supposed to buy a 60 percent equity stake in Bandar Malaysia. It refuted claims that it could not fulfil payment obligations.
Following this, Prime Minister Najib Abdul Razak began approaching investors from China, with Dalian Wanda group being a priority target.
The botched deal was a major blow for IWH, which is a joint venture between Credence Resources Sdn Bhd and KPRJ.
The Johor legislative assembly sitting is in session and will conclude tomorrow with Johor Menteri Besar Mohamed Khaled Nordin’s winding up speech.